Former Alex and Ani CEO Giovanni Feroce cites clash over growth as factor in his ouster/ Poll

Monday

Mar 31, 2014 at 10:39 PM

"Can she be the CEO of this company? Absolutely not," former Alex and Ani CEO Giovanni Feroce said of company founder and creative designer Carolyn Rafaelian.

Kate Bramson Journal Staff Writer journalkate

Giovanni Feroce, the former CEO of Alex and Ani, said his unexpected departure from the Cranston jewelry company stems from a disagreement with company founder and creative designer Carolyn Rafaelian over how quickly the company should expand.

“There’s no sense of urgency,” Feroce said in a 70-minute interview with The Providence Journal.

He said he wanted to bring in designers who could expand the company into a “lifestyle brand” to compete with the likes of Michael Kors, Ralph Lauren and Tory Burch.

Feroce’s vision for the company, best known for its customizable and expandable bangles, included apparel, handbags, home goods, clothing, perfume and other accessories. When customers stepped into the company’s nearly 40 retail locations, Feroce did not want them to think of Alex and Ani as a jewelry store, he said.

“[As for] her brilliant understanding of the jewelry — Carolyn will forever go unmatched, but that’s on cruise control,” Feroce said. “She should spend her time on other things.”

Rafaelian has declined requests from The Providence Journal to talk about Feroce’s departure on March 13, the company’s future and the search for a new CEO. The company issued a statement Monday in response to questions from The Providence Journal.

“Alex and Ani’s core products that promote the power of positive energy continue to perform exceptionally well, and as such have helped to set the stage for the company to expand into lifestyle product extensions later this year,” the company said. “Our in-house team of designers — lead [sic] by Carolyn Rafaelian, have been working on these new products for several years, and we are excited they have been well received by consumers in initial trials.”

Rafaelian began Alex and Ani, named for her first two daughters, as a jewelry line in her father’s Cranston jewelry factory, Cinerama. She incorporated the company in 2003, and the company announced that she was appointed interim CEO on the day of Feroce’s departure.

Rafaelian, 47, and Feroce, 45, began working together in 2010, shortly after they connected at a University of Rhode Island reunion. He had a background in the optical world, including his own optical shop at URI, Ferocious Eyes.

She asked Feroce to lead the company.

In 2010, the jewelry company employed 23 people and recorded annual revenue of $4.5 million. By the end of 2013, the company employed more than 1,084 people and recorded annual revenue of $230 million, according to Feroce when he was CEO.

Rafaelian describes herself as a spiritual person, and she has built her company on symbols that represent values, emotions and positive energy.

“The company’s an extension of me,” Rafaelian told The Providence Journal in July 2012.

At the time, she had just signed an agreement to buy the Sakonnet Vineyards, in Little Compton, with an eye toward selling her own wines in the Teas and Javas shops that Alex and Ani was then launching.

In the interview with The Journal, Feroce said his vision and decision-making put the company where it is today. He remains a shareholder of the company and retains his seat on the board, Feroce said, both reasons he hopes the company moves quickly to “get a real CEO.”

Yet that contradicts what Feroce told The Providence Journal on March 13, when he said he would no longer hold a seat on the company’s board. He now says that point is part of ongoing negotiations with the company.

Asked about Feroce’s role on the board, the company’s new corporate spokesman, Gregg Perry of The Perry Group, in Providence, said he does not know whether Feroce remains a shareholder and a director.

The statement said the company’s board of directors strongly believes it’s more important “to find the right woman or man to run the business than it is to rush the selection process.” Rafaelian has long been involved in “setting and executing business decisions for the company she founded,” and she’s “quite comfortable” in that role for as long as necessary, the statement said.

“Can she be the CEO of this company? Absolutely not,” Feroce said. “This is a serious business with a lot of jobs on the line, and you need to have the decision-making capabilities and experiences to run ‘a machine,’ to support the creative aspects of the company, and she is too important on the creative side to pay any attention to the management side.”

“All of the famous names — the Michael Kors, Tom Ford — they all have a CEO who runs it,” Feroce said. “Just as Carolyn had me.”

Feroce declined to talk about an actual trigger that led to his departure, and the company made no mention of Feroce in its public statement.

Feroce said he and the company are in talks about “how best to sever ties.”

Feroce said an ongoing lawsuit against him and the company by its former general counsel, Robert Rainville, had nothing to do with Feroce’s departure.

Rainville asserts in the lawsuit that he was fired after he reported misconduct by Feroce that included sexual discrimination, illegal drug use and evading taxes. He also accused the company of breach of contract for failing to pay him $1 million for helping to secure $70 million in financing from a private equity firm, JH Partners of San Francisco, in September 2012.

“Those are his attempts, as he’s told people, to take down the company, whatever that means,” Feroce said. “He should be ignored. Period.”

Rafaelian said in a statement on March 13 that the company has experienced “incredible positive energy and growth.”

“Now as we seek to take the company to the next level, it is imperative we bring on board a new CEO who has experience leading a fast-growing company to the next level and who can provide the strategic direction and vision that will serve us well into the future,” her statement said.

Feroce said he would daydream about how many jobs Alex and Ani could create in Rhode Island. He said the company’s decision to use local suppliers and build its products in Rhode Island led to cost savings, higher productivity and “a commitment and love affair by the community to support the company.”

Now, some newer members of the organization are seeking to bring in more outside influence, he said.

“I would voice very strongly that Rhode Island and a Rhode Island team is a benefit to the organization,” Feroce said. “Those that have joined us who want us to bring in people from outside of Rhode Island don’t have it right. They’re missing the magic.”

Feroce has said he was prepping the company for an initial public offering, and he said last week that the company should continue to consider that as an option.

On its website, Alex and Ani is seeking to hire a director of reporting, a finance position that would prepare the company for that route. Perry said he does not know the initial date of that job posting.

Feroce also said he’s exploring many options for what to do next, including buying a brand that he can control and grow. He’s looking for a company that could eventually locate here, he said.

But he’s exploring other avenues as well, including positions in higher education, entertainment and as a motivational speaker and writer. A former Republican state senator, Feroce said politics is another option.

Asked if he’s thinking about running for office, he replied: “Not at this moment, but I’d never rule it out.”

Feroce, who had been registered as a Republican in East Greenwich, registered as a Republican in Newport on March 27, according to the Secretary of State’s Office.

Feroce said the big factor in a consideration of politics is that he’s at an age of “prime earning capacity.”

“Politics would be walking away from a lot of money,” he said.

On Twitter: @JournalKate

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